By: E.B. Boyd
Via: Fast Company

Tech companies can’t find enough engineers. So why not train them yourself? For free. And then make $20K a pop on recruiting fees.


The shortage of engineers is a perennial source of woe in Silicon Valley. Once they’re done combing the graduating classes at places like Stanford and MIT, tech companies start sniffing in each other’s backyards, hoping to lure over desperately needed talent with juicy salaries and tasty perks.

When David Albert and two partners joined Y Combinator, a VC firm that invests a small amount of money in a large number of startups in exchange for stakes in the companies, in the summer of 2010, they thought they could help solve that problem with a sophisticated algorithm that would match candidates and jobs. But what they’ve come up instead with is something surprisingly analog: a real-world school, based in New York, where they spend three months at a time helping people who already program get better.

What’s revolutionary about the program is both its business and operational models. There are certainly other schools that have set up shop recently, to help crank out engineering talent. In Chicago, Code Academy offers 11-week courses in web design and development, and at San Francisco’s Dev Bootcamp, students learn the fine points of Ruby on Rails and HTML5.

But at Hacker School, there’s no tuition. Students attend for free. (Though Albert and his partners, Nicholas Bergson-Shilcock and Sonali Sridhar, do vet for talent and aptitude.) The three make money through Hackruiter, a seperate [sic] arm of their venture, when companies like Airbnb snap up the participants. (The average recruiting fee is $20,000, the industry standard.)

And once school opens, there’s no instruction. Instead, participants work side-by-side on personal projects, usually involving open-source software. The learning comes by being jammed together in the same place and having smart people nearby to learn from and ask questions of. “It’s like a writers retreat for computer programmers,” Albert tells Fast Company. “You don’t learn English at a writers retreat, but you hone your craft.”

The venture has attracted funding from Ron Conway’s SV Angel and Founder Collective, which includes entrepreneurs like Flickr cofounder Caterina Fake and Meetup cofounder and CEO Scott Heiferman

David Lee, of SV Angel, tells Fast Company that Hacker School and Hackruiter are emerging at a time when the tech world is rethinking the conventional wisdom that says you have to graduate from a school of higher learning in order to become a programmer. “There’s not the same sort of blind faith that people had in institutions and the conventional way of doing things,” Lee says. “There are now ways of demonstrating that you’re the best coder without going to a four-year college.”

Hacker School’s first session–a test drive–took place last summer with about half a dozen participants. Just about all–five out of six–were later hired. Same with a second session of 12 people. The third session starts next week with two dozen students.

Given that there are no classes, it might look to outsiders like the school’s founders aren’t really doing anything, and still earning some cushy dough for their efforts. What’s to prevent someone else from copying the idea and stealing Hacker School’s clientele? The answer: It actually takes skill to create an environment where self-motivated learners can develop skills and get better, Lee says. “It’s like throwing a party. Some people do it better than others.”

To that end, Albert and his partners plan to see if they can grow the school to 200 students. Along the way–in true Y Combinator iterate-as-you-go-style–the business model might evolve.

“The goal in the long term is to create an awesome school for programmers and hopefully inspire more people to want to be craftspeople,” Albert says. “How it’s going to do that in the long run, we’re not exacty [sic] sure.” But as long as the school pays for itself (and their expenses are low–mostly just salaries for the three founders), he explains, “that gives us license to experiment.”

By Motoko Rich
via nytimes.com

Private Sector Gets Job Skills; Public Gets Bill



When companies are deciding where to build new facilities or whether to expand in places where they already have factories or offices, states compete to shower them with incentives like tax breaks and help buying land. Increasingly, companies have come to expect that state and local governments will pay for job training, too.

For Sunday’s paper, I wrote about a $1 million customized training program that North Carolina designed for the benefit of Caterpillar, Inc., the global industrial equipment maker. The company opened a new plant in Winston-Salem in November, and the state is paying to train nearly 400 workers who will make axles for mining trucks.

North Carolina is also spending about $1.5 million to train workers for a new Honda Aircraft plant in Greensboro. About 163 workers went through training at Guilford Technical Community College in various areas including jet assembly and electrical system installation in the hopes of securing a job. Because Honda delayed the opening of its production lines, some of those workers, like Kent McDaniel, featured in this report from the video journalists at Purple States, decided to seek work elsewhere. Others, like Linda Merritt, stuck it out and are now working at Honda.

via Harvard Business Review

by Thomas Duesterberg

In what now seems a distant past, company research facilities like Xerox PARC and Bell Labs fueled innovation and growth for dominant American manufacturing firms. As the pace of technological change has quickened and the costs of R&D have grown, that model has ceased to work. Meanwhile, global competition has intensified the imperative to innovate; even long-standing manufacturing companies, such as Parker Hannifin, Timken, Kennametal, and United Technologies, strive to have 20% or more of their products be new or substantially revamped each year. Although many companies still maintain proprietary research operations (Google X lab, for example), they’re increasingly turning outward and depending on distributed or open research, in which firms or clusters of firms tap into larger networks of academic and applied work to drive new product and process development.

Of course, no single model of distributed R&D works for all companies. Large firms like Proctor & Gamble can push R&D and product innovation out through their supplier networks. P&G maintains a goal of 50% of its total innovation from outside the company, and half of that from outside suppliers. As Henry Chesbrough has argued, such a model requires rethinking internal organization as well as effectively working with the broader research community. Japanese automakers have long relied on their suppliers as innovation partners. U.S. automakers too have pushed product and process improvement out through their supply chain via the relentless drive to achieve 3% cost reduction year after year and still build competitive new models. Large firms can also buy smaller ones to acquire new technology.

Smaller companies in the manufacturing sector, competing in a global environment for increasingly sophisticated products, often don’t possess the financial strength or the in-house technical expertise to take advantage of the available science and engineering resources that can help them innovate and grow. New types of local and regional consortia or clusters are popping up in response to this problem, sometimes facilitated by public-private partnerships. An interesting example, just getting under way, is the Midwest Project for SME-OEM Use of Modeling and Simulation–a consortium of large OEMs like General Electric, Proctor & Gamble, and Deere; the State of Ohio; and several projects funded by the National Science Foundation (NSF), including the Center for Manufacturing Services, the Ohio Super-Computer Center, and the Network for Computational Nanotechnology (NCN). NCN serves as a virtual laboratory through online simulation and education. It develops models and simulation tools to predict behavior at the device, circuit and system levels for nanoelectronics, nanomechanics, and nanobio systems. It serves over 180,000 users and mounts over 10,000 simulations a year, and also provides access to supercomputers to its users as needed.

The idea behind the Manufacturing HUB, a NSF-funded initiative at Purdue and a key part of the Midwest Project, is similar to the NCN but more explicitly designed to aid small and medium manufacturers (SMEs) in getting access to models, computing power, and technical expertise to aid their product and process innovation. The models and computational resources will give SMEs access to the resources needed to solve advanced problems in areas like fluid flow, structural behavior, and material strength which are crucial to building advanced products and processes.

The common thread of these developments is building and accessing larger networks — beyond the single firm or even clusters of small firms — to create the new products and processes needed to compete in a global manufacturing market. Many questions about these models remain to be solved with actual experience — systems integration, disconnect between R&D and production, intellectual property rights issues, tragedy of the commons, leaking competitive advantage — but the trends are well embedded at this point.

What are you seeing in your business or research that can point to the strengths and weaknesses of these models?

THOMAS DUESTERBERG

Thomas Duesterberg is the executive director of the Program on Manufacturing and Society in the 21st Century at The Aspen Institute.

Coinciding with Veteran’s Day, a number of new initiatives were announced to help put veterans back to work. Here are a few resources for communities with large military operations, as well as veterans returning home.

President Obama has announced a new initiative to support veterans looking to return to the workforce. The Returning Heroes Tax Credit provides firms that hired unemployed veterans with a maximum tax credit of $5,600 per veteran. The Wounded Warriors Tax Credit offers firms that hire veterans with service-connected disabilities a maximum credit of $9,600.

Indeed.com and Google also launched products aimed at supporting the veteran community this month. At military.indeed.com, veterans can now enter their Military Occupational Code (MOC) to search for civilian jobs on Indeed that match their skills and experience. In a similar spirit, Google launched a Veterans Job Bank in partnership with the Department of Veterans Affairs.



These initiatives are timely in light of the Bureau of Labor Statistics report that put the unemployment rate for veterans who served in the military at any time since September 2001 (known as Gulf War-era II veterans) at 11.5% in 2010 (as compared to 8.7% for all veterans and 9.4% for nonveterans). Additionally, about 25% of Gulf War-era II veterans reported having a service-connected disability, compared with 13 percent for all veterans.

In a recent National Public Radio (NPR) report veterans describe a job market that presents some unique challenges. These challenges include a generation of managers who are less likely to have direct military experience (and therefore less likely to fully comprehend the range of skills veterans bring to the job) and the fact that some military qualifications do not automatically transfer to the private sector. However, David Loughran, senior economist at the Rand Corporation, goes on to describe how veterans actually have an employment advantage over the long run, including lower unemployment levels than civilians (8.7% vs 9.4%).

via The Official Google Blog

The website Google for Veterans and Families brings together Google products and platforms for servicemembers and their families. We believe it will be useful to all veterans, whether still in the service, transitioning out, or on a new path in their civilian lives. Here are some examples of what you’ll find on the site:

VetConnect – This tool helps servicemembers connect, communicate and share their experiences with others who have served using the Google+ platform.

Google Veterans Channel – A YouTube channel for discussion about military service for veterans, their families and the public. Veterans can share their experiences with each other as well as with civilians to help shed light on the importance and complexity of service. If you have not served, this is a great place to offer your thanks by uploading a tribute video.

Resume Builder powered by Google Docs – We found that Docs can be a particularly helpful tool to transitioning servicemembers seeking employment. Resume Builder generates an auto-formatted resume that can be easily edited, saved and downloaded to share with potential employers.

Tour Builder powered by Google Earth (coming soon). A new way to tell your military story. Today, you can view some sample “tours”— 3D maps of veterans’ service histories, complete with photos and videos. Stay tuned for more details and updates on the Google Lat Long Blog.

This week, we introduced the Veterans Job Bank in partnership with the Department of Veterans Affairs. The Veterans Job Bank is a customized job search engine in the National Resource Directory (NRD), which is powered by Google Custom Search technology and crawls the web for JobPosting markup from Schema.org to identify veteran-committed job openings.

The share of federal student loan defaults rose sharply last year, especially at for-profit colleges and universities, where 15 percent of borrowers defaulted in the first two years of repayment, up from 11.6 percent the previous year.

According to Department of Education data released Monday, 8.8 percent of borrowers over all defaulted in the fiscal year that ended last Sept. 30, the latest figures available, up from 7 percent the previous year. At public institutions, the rate was 7.2 percent, up from 6 percent, and at not-for-profit private institutions, it was 4.6 percent, up from 4 percent.

“Borrowers are struggling in this economy,” said James Kvaal, deputy under secretary of education. “We see a strong relationship between student default rates and unemployment rates.”

Although the new overall rates are the highest since the 1997, when they were also 8.8 percent, default rates peaked in 1990 at more than 20 percent. The new rates represent a snapshot in time, covering the 3.6 million borrowers whose first loan payments came due between Oct. 1, 2008, and Sept. 30, 2009, and who defaulted before Sept. 30, 2010. More than 320,000 of those borrowers defaulted during that period.

Although for-profit colleges, which typically serve low-income students, enroll only about 10 percent of the nation’s undergraduates, Mr. Kvaal said, their students made up 150,000, or almost half, of the defaults. The problem may be even greater. “Some research has shown that as few as one in five defaults at a for-profit college occur in the two-year window,” said Debbie Cochrane, program director at the Institute for College Access & Success, which runs the Project on Student Debt. “The extent of borrower distress is barely touched upon with these rates.”

A recent study by the Institute for Higher Education Policy found that for every borrower who defaults, at least two more fall behind in payments. The study found that only 37 percent of borrowers who started repaying their student loans in 2005 were able to pay them back fully and on time. The Department of Education is in the process of switching to a three-year default rate, in an effort to capture a more accurate picture.

The high default rate at for-profit colleges, the fastest-growing sector of higher education, has become an increasing concern for the government, since such institutions depend on federal student aid for more than 80 percent of their revenues. Last spring, in internal documents gathered from the publicly traded for-profit colleges for hearings on the student debt problem, the Senate Health Education Labor and Pensions Committee found that some companies estimated that their students had staggeringly high lifetime default rates — in one case, 77.7 percent.

Colleges with excessive default rates, either exceeding 40 percent in the latest year, or 25 percent for three consecutive years, can lose their eligibility for federal student aid programs. This year, five institutions — four of them for-profits — lost eligibility, Mr. Kvaal said.

In part because of the high default rates at the for-profit colleges, the department recently adopted regulations designed to curb recruiting abuses, and cut off eligibility for federal aid at programs that leave students with high debt loads and poor job prospects.

Student borrowing has been increasing in recent years, as tuition has grown faster than inflation or family income. And with the recession, and high unemployment rates for young workers, default rates may continue to rise for some years. Borrowers who default can face a lifetime of consequences, including inability to borrow for a car or a house, wage garnishment, seizure of tax refunds, or even, in an era when employers increasingly check credit reports, difficulty in getting a job.

Many borrowers, even those who are unemployed or earning little, can avoid default by participating in an income-based repayment program that began in 2009 but is not as widely used as might be expected. Under the program, borrowers who pay 15 percent of their discretionary income for 25 years — 10 years if they are in public service — can have the rest of their federal student loan debt forgiven; in 2014, that will go down to paying 10 percent of discretionary income for 20 years.

“In the age of income-based repayment, there is no reason for a student to default, since even a payment of zero dollars is acceptable payment, if you have zero discretionary income,” Ms. Cochrane said. “But as of April of this year, only about 350,000 borrowers have entered income-based payment, a small subset of the eligible population. Students need to understand the options, colleges need to share the information, and the department needs to make it as easy as possible for students to enroll.”

By TAMAR LEWIN
via NYTimes